My personal blog about international trade, public policy & politics, pop culture, and stuff that probably interests only me

Sunday, July 11, 2010

Maybe Our Astronauts Aren't Unionized

One of the "big" stories roaming the blogosphere last week was the absurd (and admittedly a little troubling) statements by NASA head administrator Charles Bolden that, when he became head of the US space agency, President Obama explicitly tasked him with three things (emphasis mine):

One, he wanted me to help re-inspire children to want to get into science and math; he wanted me to expand our international relationships; and third, and perhaps foremost, he wanted me to find a way to reach out to the Muslim world and engage much more with dominantly Muslim nations to help them feel good about their historic contribution to science and engineering -- science, math and engineering.

Yes, you read that correctly, the President's "perhaps foremost" task for the American space agency chief was, not to explore new worlds or discover super-awesome things that we haven't even thought of yet, but instead to make the Muslim world feel all warm and fuzzy about itself. Now, as expected, Obama's critics had a field day with this news, and the White House quickly responded with these handy talking points:

NASA assistant administrator for public affairs Bob Jacobs told ABC News that “Administrator Bolden understands that NASA's core mission is exploration, both in space and in scientific endeavors here at home. Inherent to the success of that mission is cooperation and collaboration with other nations which are equally committed to this effort, including expanding the range of countries with which NASA engages and partners.”

In response to criticism, White House spokesman Nick Shapiro said in a statement that “The President has always said that he wants NASA to engage with the world’s best scientists and engineers as we work together to push the boundaries of exploration. Meeting that mandate requires NASA to partner with countries around the world like Russia and Japan, as well as collaboration with Israel and with many Muslim-majority countries. The space race began as a global competition, but, today, it is a global collaboration.”

Leaving aside the abject boneheadedness of Bolden's original comments, the White House spin here is eminently reasonable - rapid advancement of the highest-tech manufacturing demanded by deep space exploration requires specialization and collaboration in order to produce the best product in the most efficient manner. So if the Russians dominate at rockets, and the Americans dominate at computer systems, and the Japanese dominate at, umm, laser beams (ok, I have no idea - everything I know about space comes from 80s movies and TV), they should each should focus on what they do best and then collaborate to produce the best spaceship (or robo-jetpack?). Although this actually is rocket science, the concepts are certainly not new - specialization and comparative advantage have been around for a long, long time.

What is new, however, is that such sound economic theory is coming from this White House. And that's not partisan hyperbole. Really.

You see, President Obama is not a big fan of international collaboration in manufacturing, even though global supply chains and realtime logistics are standard practice these days. Instead, he likes to preach what I like to call "adversary economics" - the archaic idea that global manufacturing is all about "us" versus "them," and "they" are gunning for "our" jobs. In no area is the President's approach more clear than in "green" energy and manufacturing. For example, here's the President in his first speech to Congress in February 2009:

We know the country that harnesses the power of clean, renewable energy will lead the 21st century. And yet, it is China that has launched the largest effort in history to make their economy energy efficient. We invented solar technology, but we’ve fallen behind countries like Germany and Japan in producing it. New plug-in hybrids roll off our assembly lines, but they will run on batteries made in Korea. Well I do not accept a future where the jobs and industries of tomorrow take root beyond our borders – and I know you don’t either. It is time for America to lead again.

That sure doesn't sound like a guy embracing the spirit of collaboration, now does it? Indeed, as I noted last week, the President's adversarial approach to global economics has drawn criticism from several American CEOs who recently noted that that Obama simply doesn't understand how today's global economy operates and just how important global collaboration is for modern manufacturing. As Cato's Dan Ikenson recently wrote:

During the past few decades, a truly global division of labor has emerged, presenting opportunities for specialization, collaboration, and exchange on scales once unimaginable. The confluence of falling trade and investment barriers, revolutions in communications and transportation, the opening of China to the West, the collapse of communism, and the disintegration of Cold War political barriers has spawned a highly integrated global economy with vast potential to produce greater wealth and higher living standards.

The factory floor is no longer contained within four walls and one roof. Instead, it spans the globe through a continuum of production and supply chains, allowing lead firms to optimize investment and output decisions by matching production, assembly, and other functions to the locations best suited for those activities. Because of foreign direct investment, joint ventures, and other equity-sharing arrangements, quite often "we" are "they" and "they" are "we." And because of the proliferation of disaggregated, transnational production and supply chains, "we" and "they" often collaborate in the same endeavor. In the 21st century, competition is more likely to occur between entities that defy national identification because they are truly international in their operations, creating products and services from value-added activities in multiple countries. There is competition between supply chains, but only after there is cooperation and collaboration within supply chains.

Global supply chains, transnational sourcing and investment and realtime logistics are not science fiction. They're very real, and by maximizing specialization and comparative advantage, have dramatically accelerated innovation and production. The result: immense benefits for the world's companies and consumers that were unfathomable only a generation ago. Dan gets it. American CEOs get it. But, on everything except space exploration, President Obama just doesn't get it.

So why, pray tell, is global collaboration good enough for exploring other planets but not for (among other things) saving our own?

Unfortunately, I can think of only two answers to that question, and neither flatters the White House.